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Over the past year or so, a new Internet buzzword has emerged: Web 2.0.

Broadly speaking, the termcoined by O'Reilly Media, a U.S.-based publisher of technology-related books and organizer of tech conferencesis used to refer to Web-based products, websites or services that are interactive in more than the usual way.

In the past, websites were considered interactive if they had an e-mail address or a clickable button. A Web 2.0 site, however, allows a visitor to input new information, rearrange the layout of the content, and, in many cases, publish it seamlessly with the site's original content.

Although the use of the term Web 2.0 makes it sound like something radically different is going on, in many ways it is just an evolution of what the Internet has always been.

This evolution is partly a result of high-speed Internet access becoming ubiquitous, better software being available, and more people using Web services. Where shopping on-line might have seemed exotic a decade ago, today it is seen as commonplace. Consumers are used to planning trips using Web-based maps, inviting people to parties with Web-based invitation services, and even downloading television shows and music using systems such as iTunes.

The explosive success of Google has also played a part in the advancement of Web 2.0, even though the company isn't really "Web 2.0" as such. After all, it does Web searches, which isn't that much different from what Yahoo or AltaVista used to do. However, Google's business model is different. It provides services (search, Web-based e-mail, and so on) for free, and pays for them by selling search-related ad termsa business that now has a market value of $110-billion (U.S.).

In many ways, this has changed the nature of Web-based businessesor at least opened up the possibility that on-line services can survive on advertising alone, just like Google. As a result, some startups that have used Web 2.0-type technologiessuch as Flickr, a photo-sharing site founded in Vancouver, and del.icio.us, a "social bookmarking" sitehave been bought by Yahoo for upwards of $25-million. The Internet giant's rationale is that by aggregating interactive sites and services, it can draw more users toward its other services, thus justifying higher ad rates for its own version of pay-per-click advertising.

Weblogs or blogs are another hallmark of Web 2.0, allowing anyone to be a micropublisher. Technorati, a blog-tracking company, currently monitors more than 30 million blogs. While many of them may be generated by automatic information feeds, or put up by teens in a flurry of initial enthusiasm, almost four million blogs are updated with new content at least once a week. Some of the top ones, such as the pop culture site BoingBoing.et, get more than 60,000 unique readers a day, which makes them as large as a metropolitan newspaper.

Smart companies are already using tools such as Technorati and other aggregators such as PubSub and BlogPulse to track discussion of their products or services in the blogosphere. Using a technology known as RSS (Really Simple Syndication), companies can create customized feeds related to particular keywords, and then subscribe to them so that they are kept constantly updated on what is being said about them on-line.

Another thing that characterizes many Web 2.0 websites and services is the use of a group of interactive technologies known as AJAX (for Asynchronous Javascript and XML). Taken together, they allow websites to be more interactiveor to allow users to interact with them more quickly and easily. Thanks to AJAX, Google Maps allows you to zoom in and pan around a map with just a mouse. Older mapping services had required that users click a button and wait for the page to reload every time the view changed. A site like Flickr lets the user edit the title or caption of a photo right in the page without reloading it.

These types of technologies are being used to recreate much of the software that business users take for granted when using their desktops, but are delivering it over the Web instead of from a program on the computer's own hard drive.

Writely.com, for example, is an on-line word processor that uses AJAX to produce documents that can be edited, saved, exported, or published to a website with a single click. JotSpot Tracker is a spreadsheet service that effectively recreates what business users do with Excel, except on a website. And there are at least half a dozen on-line calendars and e-mail services that effectively duplicate what is possible with the desktop version of Microsoft's Outlook program.

Microsoft and Google seem to be competing to see who can deliver more services on-line using Web 2.0-type technologies. Google already has e-mail, and is now offering "hosted" e-mail, which allows companies and institutions to use its Gmail service for their internal e-mail but keep their own Internet addresses and domains (Microsoft also has a trial of this type of service under way).

Google has also launched an on-line RSS feed reader, and a simple web page generation service that uses AJAX. Microsoft, meanwhile, has been pushing more and more of its services on-line, and upgrading its webmail (ironically, Microsoft's Outlook Web Access was the first to use the technologies that later became known as AJAX).

And while Google has denied it, there are still rumours that the company will eventually launch a full-fledged Web 2.0 Office-style suite that would compete with Microsoft's popular Office, but be totally Web-based.

And then the Web 2.0 war would really be on.